Statistics for Business and Economics

Tenth Edition, Global Edition

Chapter 6
Sampling and
Sampling
Distributions

Slide - 1
Chapter Goals
After completing this chapter, you should be able to:
• Describe a simple random sample and why sampling is
important
• Explain the difference between descriptive and inferential
statistics
• Define the concept of a sampling distribution
• Determine the mean and standard deviation for the
sampling distribution of the sample mean, X
• Describe the Central Limit Theorem and its importance
• Determine the mean and standard deviation for the
sampling distribution of the sample proportion, p̂
• Describe sampling distributions of sample variances
Slide - 2
Introduction
• Descriptive statistics
– Collecting, presenting, and describing data
• Inferential statistics
– Drawing conclusions and/or making decisions
concerning a population based only on sample
data

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Inferential Statistics (1 of 2)
• Making statements about a population by
examining sample results

Slide - 4
Inferential Statistics (2 of 2)
Drawing conclusions and/or making decisions
concerning a population based on sample results.
• Estimation
– e.g., Estimate the population
mean weight using the sample
mean weight
• Hypothesis Testing
– e.g., Use sample evidence
to test the claim that the
population mean weight is
120 pounds
Slide - 5
Section 6.1 Sampling from a
Population
• A Population is the set of all items or individuals
of interest
– Examples: All likely voters in the next election
All parts produced today
All sales receipts for November

• A Sample is a subset of the population

– Examples: 1000 voters selected at random for interview
A few parts selected for destructive testing
Random receipts selected for audit

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Population vs. Sample

Slide - 7
Why Sample?
• Less time consuming than a census
• Less costly to administer than a census
• It is possible to obtain statistical results of a
sufficiently high precision based on samples.

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Simple Random Sample
• Every object in the population has the same probability of
being selected
• Objects are selected independently
• Samples can be obtained from a table of random numbers
or computer random number generators

• A simple random sample is the ideal against which other

sampling methods are compared
Slide - 9
Simple Random Sample

Slide - 10
 Sampling Distributions
• A sampling distribution is a probability
distribution of all of the possible values of a
statistic for a given size sample selected from a
population

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Developing a Sampling
Distribution (1 of 6)
• Assume there is a population …
• Population size N=4
• Random variable, X, is
age of individuals
• Values of X: 18, 20, 22,
24 (years)

Slide - 12
Developing a Sampling
Distribution (2 of 6)
In this example the Population Distribution is uniform:

Slide - 13
Developing a Sampling
Distribution (3 of 6)
Now consider all possible samples of size n = 2
(WITH REPLACEMENT)

Slide - 14
Developing a Sampling
Distribution (4 of 6)
Sampling Distribution of All Sample Means

Slide - 15
Chapter Outline

Slide - 16
Section 6.2 Sampling Distributions of
Sample Means

Slide - 17
Sample Mean
• Let X 1 , X 2 ,..., X n represent a random sample from a
population

• The sample mean value of these observations is defined as

1 n
X =  Xi
n i =1

Slide - 18
Standard Error of the Mean
• Different samples of the same size from the same
population will yield different sample means
• A measure of the variability in the mean from sample to
sample is given by the Standard Error of the Mean:


X =
n
• Note that the standard error of the mean decreases as the
sample size increases

Slide - 19
Standard Error of the Mean

Slide - 20
Comparing the Population with Its
Sampling Distribution
Population Sample Means Distribution
N =4 n=2
 = 21  = 2.236  X = 21  X = 1.58

Slide - 21
Developing a Sampling
Distribution (5 of 6)
Summary Measures for the Population Distribution:

 Xi
=
N
18 + 20 + 22 + 24
= = 21
4

( X i −  ) 2
= = 2.236
N

Slide - 22
Developing a Sampling
Distribution (6 of 6)
Summary Measures of the Sampling Distribution:

 X i 18 + 19 + 21 + + 24
E( X ) = = = 21 = 
N 16

( X i −  ) 2
x =
N
(18 − 21) 2 + (19 − 21) 2 + + (24 − 21) 2
= = 1.58
16
Slide - 23
Developing a Sampling Distribution
𝜎 2.236
1.58 = 𝜎𝑋ሜ = =
𝑛 2

Slide - 24
If Sample Values Are Not Independent
• If the sample size n is not a small fraction of the population
size N, then individual sample members are not distributed
independently of one another
• Thus, observations are not selected independently
• A finite population correction is made to account for this:

2 N −n  N −n
Var ( X ) = or  X =
n N −1 n N −1
( N − n)
The term is often called a finite population correction factor
( N − 1)

Slide - 25
If the Population Is Normal
• If a population is normal with mean  and
standard deviation  , the sampling distribution of
X is also normally distributed with

 X =  and  X =
n
• If the sample size n is not small relative to the
population size N, then
 N −n
 X =  and  X =
n N −1
Slide - 26
Standard Normal Distribution for the
Sample Means
• Z-value for the sampling distribution of X :

X − X −
z= =
X 
n
where: X = sample mean
 = population mean
 X = standard error of the mean
Z is a standardized normal random variable with mean of 0 and a
variance of 1

Slide - 27
Sampling Distribution Properties (1 of 3)

E  X  = 

(i.e. X is unbiased)

(both distributions have the same mean)

Slide - 28
Sampling Distribution Properties (2 of 3)


X =
n

(i.e. X is unbiased)

(the distribution of X
has a reduced standard deviation)
Slide - 29
Sampling Distribution Properties (3 of 3)
As n increases,
 X decreases

Slide - 30
Central Limit Theorem (1 of 3)
• Even if the population is not normal,
• …sample means from the population will be
approximately normal as long as the sample size
is large enough.

Slide - 31
Central Limit Theorem (2 of 3)
• Let X 1 , X 2 ,..., X n be a set of n independent random
variables having identical distributions with mean
 , variance  2 , and X as the mean of these random
variables.
• As n becomes large, the central limit theorem states that
the distribution of

X − x
Z=
X
approaches the standard normal distribution

Slide - 32
Central Limit Theorem (3 of 3)
As the sample size gets large enough…
the sampling distribution becomes almost normal
regardless of shape of population

Slide - 33
If the Population Is Not Normal
Sampling distribution
properties:
Central Tendency
X = 
Variation

X =
n

Slide - 34
Simulation Evidence

Slide - 35
Simulation Evidence

Slide - 36
How Large Is Large Enough?
• For most distributions, n > 25 will give a sampling
distribution that is nearly normal
• For normal population distributions, the sampling
distribution of the mean is always normally
distributed

Slide - 37
Example 1 (1 of 3)
• Suppose a large population has mean  = 8 and
standard deviation  = 3. suppose a random
sample of size n = 36 is selected.
• What is the probability that the sample mean is
between 7.8 and 8.2?

Slide - 38
Example 1 (2 of 3)
Solution:
• Even if the population is not normally distributed,
the central limit theorem can be used (n > 25)
• … so the sampling distribution of X is
approximately normal

• … with mean  X = 8
 3
• …and standard deviation  X = = = 0.5
n 36

Slide - 39
Example 1 (3 of 3)
Solution: (continued):
 
 7.8 − 8  −  8.2 − 8 
P (7.8   x  8.2) = P   x  
 3  3 
 
 36 n 36 
= P (−0.4  Z  0.4) = 0.3108

Slide - 40
Section 6.3 Sampling Distributions of
Sample Proportions

Slide - 41
Sampling Distributions of Sample
Proportions
P = the proportion of the population having some
characteristic
• Sample proportion ( pˆ ) provides an estimate of P:
X number of items in the sample having the characteristic of interest
pˆ = =
n sample size

• 0 ≤ 𝑝Ƹ ≤ 1
• p̂ has a binomial distribution, but can be approximated
by a normal distribution when nP (1 − P )  5

Slide - 42
Definition Elaboration

Slide - 43
Sampling Distribution of p Hat
• Normal approximation:

P (1 − P )
Properties: E ( pˆ ) = P and  pˆ =
n
(where P = population proportion)

Slide - 44
Where does it come from

Slide - 45
Z-Value for Proportions
Standardize p̂ to a Z value with the formula:
𝑝ො − 𝑃 𝑝ො − 𝑃
𝑍= =
𝜎𝑝ො 𝑃(1 − 𝑃)
𝑛
Where the distribution of Z is a good approximation
to the standard normal distribution if nP (1 − P )  5

Slide - 46
Example 2 (1 of 3)
• If the true proportion of voters who support
Proposition A is P = 0.4, what is the probability
that a sample of size 200 yields a sample
proportion between 0.40 and 0.45?

• i.e.: if P = 0.4 and n = 200, what is

P ( 0.40  pˆ  0.45 ) ?

Slide - 47
Example 2 (2 of 3)
• if P = 0.4 and n = 200, what is
P ( 0.40  pˆ  0.45 ) ?

P (1 − P ) .4(1 − .4)
Find  pˆ :  pˆ = = = .03464
n 200

Convert to  .40 − .40 .45 − .40 

standard P (.40  p  .45) = P  .03464  Z  .03464 
ˆ
 
normal:
= P (0  Z  1.44)

Slide - 48
Example 2 (3 of 3)
• if P = 0.4 and n = 200, what is
P ( 0.40  pˆ  0.45 ) ?

Use standard normal table: P ( 0  Z  1.44 ) = .4251

Slide - 49
Extra Example

Slide - 50
Section 6.4 Sampling Distributions of
Sample Variances

Slide - 51
Sample Variance
• Let x1 , x2 ,..., xn be a random sample from a
population. The sample variance is
n
1
s2 = 
n − 1 i =1
( xi − x ) 2

• the square root of the sample variance is called

the sample standard deviation

• the sample variance is different for different

random samples from the same population
Slide - 52
Slide - 53
Sampling Distribution of Sample
Variances
• The sampling distribution of s 2
has mean  2

E (s 2 ) =  2

• If the population distribution is normal, then

2 4
Var ( s 2 ) =
n −1

Slide - 54
Chi-Square Distribution of Sample
and Population Variances
• If the population distribution is normal, then

(n − 1) s 2
 2
n −1 =
2
has a chi-square (  2 ) distribution
with n − 1 degrees of freedom

Slide - 55
Slide - 56
The Chi-Square Distribution
• The chi-square distribution is a family of distributions,
depending on degrees of freedom:
• d.f. = n − 1

• Text Appendix Table 7 contains chi-square probabilities

Slide - 57
 Degrees of Freedom (df)
Idea: Number of observations that are free to vary after
sample mean has been calculated
Example: Suppose the mean of 3 numbers is 8.0

Here, n = 3, so degrees of freedom = n − 1 = 3 − 1 = 2

(2 values can be any numbers, but the third is not free to vary for a given
mean)
Slide - 58
Chi-Square Example (1 of 2)
• A commercial freezer must hold a selected temperature
with little variation. Specifications call for a standard
deviation of no more than 4 degrees
(a variance of 16 degrees 2 ).
• A sample of 14 freezers is to be tested
• What is the upper limit (K) for
the sample variance such that
the probability of exceeding this
limit, given that the population
standard deviation is 4, is less
than 0.05?

Slide - 59
Finding the Chi-Square Value
( n − 1) s 2
Is chi-square distributed with (n − 1) = 13
 =
2

2 degrees of freedom

• Use the the chi-square distribution with area 0.05 in the

upper tail:
χ213 = 22.36 (𝛼 = .05 and 14 − 1 = 13 d. f. )

Slide - 60
Chi-Square Example (2 of 2)
 213 = 22.36 ( = .05 and 14 − 1 = 13 d.f .)

 ( n − 1) s 2
2 
So: P(s  K ) = P 
2
  13  = 0.05
 16 
(n − 1) K
or = 22.36 (where n = 14)
16
(22.36)(16)
so K = = 27.52
(14 − 1)
2
If s from the sample of size n = 14 is greater than 27.52, there is
strong evidence to suggest the population variance exceeds 16.

Slide - 61
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Slide - 65
Sampling Distribution of Sample
Variances (Simple Proof: Not Required)
• The sampling distribution of s 2
has mean  2

E (s 2 ) =  2

• If the population distribution is normal, then

2 4
Var ( s 2 ) =
n −1

Slide - 66
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